"There's this really exciting renaissance of these hybrid bottoms-up, top-down SaaS models. I think that's the future." - Airtable CEO Howie Liu
In the early days of Airtable, Co-founder and CEO Howie Liu got what he calls the worst advice of his life — that in order for the company to be successful he needed to pick a lane. Even when he explained the product to people who loved the idea behind Airtable, some cautioned the use cases were too broad, which would limit growth. Nearly 10 years later, he’s glad he stayed the course.
In a one-on-one interview with Caryn Marooney, General Partner of Coatue Management, Howie explores the nuances of being a horizontal platform, the knife’s edge difference between when to exercise patience versus impatience, and why startup founders have to invest in their own professional development to succeed.
This interview is part of Saastr 2020. SaaStr is the world’s largest community of SaaS executives, founders, and entrepreneurs.
You can check out the full interview here, or read some of the highlights below:
The pros and cons of being a horizontal platform
“The fact that we’re a horizontal platform, serving all these different use cases, made it harder initially to get that running start. When we went out to raise our first few rounds of funding a ton of the investors out there would give us this feedback that ‘we think you built this really great product and yet we think the business plan is fatally flawed in that you haven’t picked a single vertical’.”
“We thought this would initially be something that appealed to tech startups, the tech savvy crowd that would be able to come in and build. As soon as we launched we saw this enormous diversity of use cases popping up on Airtable. We had hundreds of signups from big companies like Nike or Conde Nast in the first few months, but we also got literal cattle farmers building cattle tracking applications.”
“The staggering thing to me was how much there is this distributed amount of what I think of as software creativity in the world. And these people within every company, every industry, every type of organization are yearning to go build software the way they want it to work and we’ve been fortunate to provide an outlet for a lot of those use cases.”
“There's this combination of keeping the core product experience as intuitive and flexible as possible so we can support all these long tail use cases like cattle farming, but starting to layer on these vertical prongs of product and go-to-market specialization so we can go after the high value use cases.”
The balance between a bottoms-up versus a top-down sales approach
“We’re not just trying to get our customers to pay us more money, and use sales as the way to extract that from them, quite the opposite. Sales has this opportunity to be proactive and present ideas on how customers can make more use of Airtable or expand to new teams within their enterprise who can genuinely get value out of building on Airtable.”
“The best models are synergistic where your salespeople are actually leveraging this bottoms-up adoption within an existing account. For us we have literally tens of thousands of companies who already have a five or greater seat workspace. A sales person can reach out and say ‘how can you get better value out of Airtable?’ so leveraging that bottoms-up system versus a top-down only sales engine that is totally separate.”
“There's this really exciting renaissance of these hybrid bottoms-up, top-down SaaS models. I think that's the future. I think the companies with the best unit economics are going to have this.”
Advice for entrepreneurs
“Have the right balance of patience and impatience, as well as urgency. In some regards we were correctly patient in building a horizontal business. We resisted the temptation to do something quicker and easier than maybe switching to a project management tool. At the same time we could have done things faster by putting more focus on how you get more leverage. You could hire more great people and then maybe you don’t have to work until 4am every day. Finding ways to get more leverage early on, we could have accelerated things.”
The worst advice he’s ever received? “You will not succeed unless you pick a vertical and pick a specific use case. As founders you have to trust your instincts and take advice but if you feel instinctively strongly you have to go for it.”
The best advice he’s ever received was from Facebook’s Mark Zuckerberg. “We tend to overestimate competition in the short term but underestimate it in the long term. Calm down in the short term but be more paranoid in the long term.”
Find the right investors and remember to invest in yourself along the way
“Having investors who were very supportive of us, and being very patient with how long it would take was critical. With a different set of investors we might not have made it, we might have been pressured to sell out early or go down a more narrow path. So that’s an important thing to get right, find people who share your human values, cultural values, but also the values of the company and what you’re aspiring to become.”
“Learning as quickly as possible is the most important skill set that any CEO can have. You don’t know everything you need to know to run this business and you never will, but the only thing you can do is swallow all the knowledge you can like a whale streaming through the ocean. Actively seeking out sources of advice, mentorship, etc is really, really crucial. It's much like investing in your own personal growth to be able to figure out what it takes to be able to run the company. I’m still learning.”
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